captioned by the national captioning institute --www.ncicap.org-- gwen: how can washington turn the page in a jobless recovery and contentious campaign. we'll get to the bottom of it all. >> remarkable chapter in the united states history and iraq, we have met our responsibilities . now it's time to turn the page. gwen: looking forward, moving ahead, talking about the positives, wap president doesn't want that. but as the labor day launched to the political season arrived, the white house faces a stubborn jobless recovery. >> jobs are being created, just not being created as fast as we need to. gwen: a new effort to arrive at

meast -- middle east peace. >> mr. prime minister and mr. president, you have the opportunity to end this conflict and the decades between your people once and for all. gwen: a newly energized republican opposition. >> lets let's stand together and restore america. gwen: we examine why the page could turn both ways with stan, deborah solomon, and john dickerson of "slate" magazine. >> covering history as it happens. live from our nation's capital, this is "washington week with gwen ifill," produced in association with national journal. funding for "washington week" is provided by --

>> what if you could just be you? what if you had your last bad date? what if she's out there? what if she's out there? what if you could beloved for exactly who you are? you can. >> funding for "washington week" is also provided by boeing, exxon mobil, the epics and excellence in journalism foundation, the annanburg, and contributions to your pbs station from viewers like you. thank you. once again, live from washington, moderator gwen ifill. gwen: good evening. so tonight, we tackle the

challenge of turning the page. president obama's oval office address provided a useful prame this week that was supposed to be about iraq but it was about so much else, including the economy, uncertain foreign policy and politics. why is august never a good month for barack obama? now we are safely in september, the question must be asked. >> you detected the pattern haven't you. he has had difficulties in augusts and ended this one in a very busy week. when he gave that speech in the oval office, he talked about turning the page. what he meant to convey is, it's time now to focus on the economy. but as that speech showed, the tension in that speech as he was trying to deal with a lot of issues at once underscored the political problems that he and the democrats and the administration have. i mean, he said the economy is my principal responsibility as president.

that's why we want to turn the page. but turning the page, let's just start with iraq. yes, the combat mission is over. we still have 50,000 troops in iraq. we will have a troop presence there until the end of next year. violence has not gone. it has been down, but continues to go up and has gone up pretty significantly recently and the political issues has not been resolved. that is a government that can't come together months after the election. turning the page on iraq alone is going to be difficult. you take afghanistan. iraq was never barack obama's war. afghanistan is. that war is not going well. he has signaled, a, a commitment to that because of the high stakes and also signaled limited patience within the american people and perhaps among a lot of his advisers to keep an open-ended commitment. he's not even close to turning the page on that. gwen: in saying our troops did

what they were supposed to do and we salute the troops, now it's your turn, america, to deal with the tough stuff here at home. it was an awkward turn, but a turn. >> i frankly thought the whole speech was awkward. he tried to pack so much into 18 minutes. and the problem i think on the economic front is that he didn't have anything concrete that he was prepared to offer that night. and so all he could do was use prime time in a significant national television audience to restate, i know what you are worried about. i get that. i'm on the case. we're working on it. >> so, dan, what were the reviews on this mixed and muddled speech? >> this is a president who earned his spurs as someone who is a gifted speaker and i think the reviews of this speech were generally mixed to poor, that, in fact, in both of his oval

office speeches. he has two, the first one on the oil spill earlier this summer, but one way or the other, they did not convey everything he needed to convey. so i think that on this, you know, maybe they feel they got a lot out of it, but there are a lot of other people who think he was delivering a lot of messages, the single message they wanted to put out didn't come through. >> this is a white house that has been talking about turning the page since last year. i mean, last year was, well, enough of this other stuff, it's jobs, jobs, jobs. and when they get distracted, they say we are going to talk about jobs. how come they never get the page turned? >> it's the nature of the presidency. presidents can't focus exactly on what they want to focus on and opportunities present themselves as this week's discussions on the middle east showed. marking the end of combat in iraq was a way for him to say at a minimum, his base, i kept an

important promise from the campaign and needs that base to be energized for the fall campaign. but the reality is, there are lots of problems he's dealing with. the economy may be the one that hangs over him and the democrats, but it's not the only thing he has got to worry about. >> speaking about the base, what did democrats think about what he had to say? did he pressure him to do something other than what he's doing? >> they want him to do all his effort on the economy. and i got an email from some democrats this week sensing dismay and others around the table did also, why is he spending prime time on national television to talk about iraq? now the white house would argue, they didn't just talk about iraq and they were able to use prime time television to talk about the economy. but a lot of democrats thought, why are we doing this speech? why are we talking about this now?

we need to focus on this now? gwen: why didn't he talk about something else? here's the other question i'm curious about, the president got the health care bill he wanted. the wall street regulatory reform bill. how come we don't hear him getting credit? >> two reasons. one, this is a very polarized country again. i think depending on which side you were on, particularly if you are on the opposite side of him on those issues, you don't give him any credit. and the other is, if the center of the electorate or among independents at least, the economic program has not delivered in the way that people want it to deliver. and until it starts to and does more significantly, he's not going to get that credit. gwen: let's move onto the other big issue that blurs the credit and that is the state of the

economy. the unemployment rate we learned today is up to 9.6% and the economy lost 54,000 jobs in august, better than expected but not at all good. according to the latest poll, most democrats, 59%, now think it might be a good idea to extend the bush tax cuts before election day, but only for those earning less than a quarter of a million dollars a year, while most republicans, 59%, think the issue of extending the tax cuts should be left up to a lame duck congress, the way to keep the issue alive. both sides know this, with the president's approval rating under 50% and congressional approval ratings even worse than that, the dire economy is also a dire political issue. but what's the most revealing indicator in those numbers we saw today, deborah? >> you are still losing jobs. the numbers are better than expected and the private sector added jobs but the economy continues to lose jobs. the president said he is going to roll out a package of

proposals again. we had a $787 billion stimulus that in some people's eyes said hasn't done enough. he is going to talk about the economy and jobs and end the week with a press conference on the economy. but the problem, though, there isn't much they can do. they are so constrained by the political climate in washington and concerns about the budget deficit and isn't much you can do in the short-term. and even something like a payroll tax cut is going to be hard to get through. republicans aren't going to be willing to give the democrats a win before election day. and then who knows what happens after november. so, the administration is split about what to do, do they propose something they think would have impact but know can't possibly pass or try and throw a bone to the republican party and say, if you don't vote for a payroll tax cut, it's on your head. gwen: they have two problems, republican party has not interest in accepting bones

thrown to it and the people on the left are saying we need more money spent, not just payroll tax cuts. >> right. there is concerns about the -- concerns about the deficit are clouding this. a payroll tax cut would cost a lot of money. and you have mixed in concern about what to do about the bush tax cuts and how there is the ability to allow tax cuts to expire for one group, but not another. why are some good and others bad. >> why is that? what is happening on the bush tax cuts? is it being shifted? is there a middle road? >> there are three camps, there is the camp that says you should extend them for everybody including the rich and republicans fall into that and some democrats, too. there is $35 billion that these tax cuts would bring back in revenue if they were allowed to expire. they say if you take it out of

their pockets, you are taking the stimulus out of the economy. those are saying, extend it to the middle class and some are saying don't extend it for anybody. so you don't have agreement in tra-party. >> the administration has said they aren't going for another stimulus package but aren't they disguised as stimulus and run the deficit up higher? >> some say they will be paid for. one idea is you let the tax cuts expire for the rich and use that small bees of money for something else and democrats would say that is not new spending. republicans would say that isn't not only new spending but a tax hikes. but they will add to the deficit. >> is there any consensus on what it would take in addition to what's out there to get the economy moving? >> there isn't. the one thing that people say could help in the short-term is tax incentives that encourage hiring, but those are expensive and they have tried them before.

they have to be broad enough so they really impact a broad swath of new employees. we have a tax credit just for employees who have been out of work for 60 days or more. some people have said it's too small. it will cost more than $35 billion. some say, fund infrastructure projects. but that takes months, if not years, to get under way. this past summer, we are seeing some of the stimulus money that was passed in february of 2009 flowing through the infrastructure projects. gwen: the white house said, the good news is that we actually increased private sector jobs and lost public sector jobs. is there some concern about that that local and state governments are losing the job loss that hurts them the most politically? >> some of the administration have argued is why you should spend some of the money to give to states and local governments. they have given a huge chumping of money, but isn't enough. the state and local economies

are in shambles and the stimulus money is going to dry up. what you did see, even though the private sector is creating jobs, you are seeing layoffs in state and local governments and will continue to drag down any employment growth we might otherwise see. gwen: as we have seen this week, timing often forces a shift in priority. that's what happened when we saw israeli prime minister netanyahu and president abbas coe to taun to reopen the peace talks. and they actually talked to each other. >> i see you a partner for peace. together, we can lead our people to a historic future that can put an end to claims and to conflict. >> let us sign an agreement for peace and put an end to a very

long period of struggle. gwen: but is it real? and why are we seeing this now? there is something remarkable about watching netanyahu turn to abbas and say, sign your agreement for peace. they don't like each other. >> they don't like each other until relatively recently. the white house wouldn't have chosen this month to do this. they were trying to turn the page to the economy. a president can't control the pace of diplomacy. president obama has been trying to get these talks since day one. so you have to ask, what took you so long. gwen: which is very different from what the last president did. it took a long time. >> that's right. there is a settlement freeze right now, construction freeze in the west bank. that is running out. but there are two larger reasons. both of those leaders were looking at circumstances and seeing that things were going to get worse, if not better, if

they didn't have a process going and the other is an outside factor, a wild card, and that's iran. president obama and prime minister netanyahu, it appears, both concluded that not having a peace process going with the palestinians was getting in the way of some of the things they wanted to do to confront iran. gwen: iran is kind of the backstop for everybody and also for other arab nations that are sitting at the table pushing them along. >> that is a big reason that egypt was there and jordan and saudis are pushing for this, too. is this real? we don't know. these are the same old issues, jerusalem, settlements, return of refugees. the parties are still far apart. but i'm going to go way out on a limb and say there is a glimmer of optimism. one is the one you mentioned. barack obama has gotten into this at the beginning of his

presidency. time ran out on george w. bush and president clinton because they waited until they were re-elected. another one, netanyahu is a super hawk in israel, but he has said for the last two years, he wants to go down as a peacemaker and more people who know him say they are beginning to believe he means it. will that be the case? we'll have to see. >> if you are on a limb here, what are the risks for obama? >> there are risks for president obama. and there are risks in failure and risks in success. if this thing grinds to a halt and doesn't get anywhere, president obama has these risks. he will have used up a lot of time and energy on it when people think he should have been doing the economy and he will look like a weak negotiator and peacemaker and tried to make his name as a peacemaker and diminish his stature. if it succeeds, he faces the

risk of arab-israeli peace talks which suggests that the united states is pushing hard on both sides and he has to push the israelis potential ily going into an election year when the republicans accuseed him of being tough. >> is this realistic? >> not if you wrap it up and get a peace treaty. that's where the administration has given itself a lot of wiggle room. they said that what they want to get is a framework. what's a framework? it could be precise or vague. gwen: haven't we seen them before? >> yes. in a sense, this is being driven not because the chances of success are high, but everyone is worried about failure. there is a buffer against failure. >> how does it affect iran? what does the timetable mean for them in these goirkses?

>> the theory here -- negotiations? >> the theory here, one is that the administration is trying to put together a kind of defacto alliance between the countries. and we are getting into a defense relationship with the saudis and the gulf states, and that gets easier to do and gets easier for the arab countries to do it if the process is going on with the palestinians. the other unstated reason down the road is that at some point, the united states or israel may be contemplating military action against iran. and whether you can pull off military action against iran and have a full-blown crisis the next day, it would help if you actually had progress on the palestinian issue if you ever wanted to pull that trigger. gwen: next meetings happen in a couple of weeks. >> hillary clinton will be there. president obama isn't going to go there.

and then they have said they are going to step up the pace and the two leaders are going to meet, netanyahu and abbas, every two weeks. something could come out of it. gwen: we'll watch, as always. but, if the violence fades in iraq and afghanistan, the economy rebounds and there is movement on middle east peace, things could calm down, right? hard to say, especially when every poll in every race shows democrats in as deep a hole as they can be entering the last two months. is the president capable of turning that page? >> if he is capable of turning the page, he will turn it after the elections happen. there are 60 days left. there isn't a lot of time to turn the page between now and election day. and we talked about how ba bad the economic numbers are and they are driving bad political numbers. there was a poll, would you vote for a republican or democrat.

51%, republican, 49% democrats. polls show enthusiasm among republicans, 25 points ahead of enthusiasm among democrats. other signs showing republicans will show up at the polls. republicans aren't that well liked. in some polls, they are less well liked than democrats. if you talk to people who are going to vote for republicans as many say we are voting against the democrats. you don't have to like the republicans, but it means republicans have been reluctant putting forward an agenda and don't have to because they are voting against the party in power. gwen: we see people like charlie cook that the senate may be in play. and i read this afternoon that governors' races are now in play, 30 governor seats could go republican. >> republicans need to pick up 39 net seats in the house. they need to pick up 10 in the

senate. that has been considered a real long shot. this week, they are saying it's now plausible. and i talked to people who are very optimistic. and what we have is what we have been talking about is the potential for a big wave election in which people who have no business getting elected do because there is this momentum. gwen: do you want to name who that would be? >> it has worked for democrats and that's why some of them are vulnerable. >> what is the playbook for the president as we go through the fall? what's the political role that he should be playing or could play that would be helpful to democrats? >> on a policy level to deal with this economic problem. he can't do much and won't affect voters. he will get on the stump and try to make these distinctions clearer. we talked about how they want to make this an election of choice and not a referendum. they want to make it us against

the republicans. he will go to cleveland on wednesday and say if you want to go backwards, do what boehner talked about in this town, if you want to go in another direction, do what i believe in. that's a direct contrast in a way that we haven't seib from him yet. >> what do you do if you are a democrat? do you distance yourself from obama? what is the strategy? >> one is working and said to the extent they are running positive ads, they won't be for much longer. the race has to be local and negative, because you want to turn it into a choice and with all of these bad numbers that i talked about, clouding the race and making things good for republicans, you have to take your opponent down. we expect to see a lot of that negativity on the air waves. >> if the race has to be local, i'm going to back to dan's

question, does barack obama help? if he does out and draws this contrast and tries to explain incidentally to voters who on earth john boehner is -- [laughter] >> exactly. >> does it work? >> it hasn't worked so far. he has given speeches and gotten more political and hasn't gotten through. it can motivate democratic voters and bring out first-time voters. he can speak to them. but there is a view that actually there isn't much that the president can do, that the economy is speaking the loudest. but i talked to a democratic strategist and said this hasn't been tested. we talked about it earlier. they said, this other person i talked to said for the last two weeks, everything the president has done hasn't gotten us a single vote, from his decoration, to the middle east,

-- gwen: name one place where the democrats aren't doing terribly? >> grayson has released a poll that he is ahead. when you release an internal poll, you can say you are santa claus. everywhere else, people are terrified. gwen: hoping that democrats will stumble. thank you everybody. the conversation will end here, but we'll pick it up online. you can go to pbs.org to find out what else we have to and keep up with developments. we'll see you right here next week on "washington week." good night. have a labor-free labor day! >> funding for "washington week" is provided by -- rere >> we know why we're here, to

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